Lack of Conviction in Institutional Bitcoin Positions, CPI and Iran Talks May Provide Clarity

Despite a 7% surge in bitcoin's price since Sunday, conviction remains weak, with the recovery stalling near $72,000 ahead of key events, including the US inflation report and US-Iran talks. Institutions are buying call options, betting on a price increase, while also purchasing put options for downside protection. The demand for puts persists, indicating a lingering bias for protection against declines. The US consumer price index for March is expected to show a significant increase in annualized inflation, primarily driven by rising energy prices. The meeting between Iranian and US delegates may hold the key to financial market stability, and a positive outcome could accelerate bitcoin's rally. The ICE BofA US Bond Market Option Volatility Estimate Index, which reflects volatility in US Treasury futures, has dropped to 74% this month, indicating calmer conditions in the bond market, a positive sign for crypto bulls.